Unethical Practices

COMPANY PROFILEEstablished in 20 February 1963 as Chrysler Philippines Corporation, Mitsubishi Motors Corporation now markets over 16 types of vehicles in the Philippines, after 45 years of operation. Vehicles range from the easily- recognizable Lancer, Galant, and Eclipse passenger cars, to light commercial vehicles of different images and purposes: the ubiquitous Pajero, and the active Strada, Montero Sport, Grandis and Fuzion. Also included on the line-up are Adventure, L300 Versa-Van, and commercial vans. Moving the industry are the FK/FM trucks and the Rosa buses. Trucked neatly between the light duty pick- ups and heavy haulers are the Canter light truck and Rosa mini- bus. Today, Mitsubishi, headed in the Philippines by Mr. Masahiko Ueki, produces thousands of vehicles a year in a 190,294 sq.m. plant along Ortigas Avenue Ext, Cainta Rizal. Mr. Masahiko Ueki is leading the company to focus on four major concerns: Manufacturing, Marketing, Labor/Management Corporation and Community Involvement. In manufacturing, production programs are aimed towards product quality. Quality Circles provide the impetus for continuous Improvement of manufacturing processes leading to improved quality and cost-effectiveness. With Total Customer Satisfaction remaining to be the underlying commitment, the importance of delivering products and services that are attune to the complex and changing needs of the customers in the Philippine market setting remains to be the trusted of marketing activities and efforts. All in all after 45 years of existence in the country’s automotive industry, Mitsubishi Motors continues to offer quality products and services to the Philippine market.

PART I

TITLE:

UNETHICAL PRACTICES OF MARKETERS/SELLERS: AN ISSUE IN CONSUMER SATISFACTION AND DISSATISFACTION

OBJECTIVES OF THE CASE:The research literature on dissatisfaction and complaining behavior has largely ignored instances of unethical behavior on the part of marketers. Three biases have led to this outcome. Research has focused on outcomes rather than processes. It has largely ignored possible ethical problems in interactions with sellers after purchase. And, economic costs have been emphasized over emotional and psychological costs. Policing systems do not appear likely to correct unethical seller behaviors and thus better monitoring is needed as is new research exploring the impact of the three sources of past bias. They need to know:

1. The frequency of market problems in need of potential intervention; 2. The seriousness of these problems, which is, in turn, a function of: a. The economic and social cost of each instance; and

b. The characteristics of those who are primarily affected (e.g. whether they are in some ways disadvantaged); 3. The availability and potential costs (to all parties) of possible solutions, including seller or industry action; and 4. The likelihood that proposed solutions will have the desired impact.

BACKGROUND OF THE CASE: This case study is about Mitsubishi Motors Philippines, an exclusive distributor of Mitsubishi Vehicles in the Philippines. Initially starting off as an entrepreneurial venture, the company had been put in the hands of a professional management group. The new team strove to cultivate a performance culture through strong results-based controls and weeding out non-performers. In 1990s the company has seen a very rapid acceleration in interest in the topic of consumer satisfaction and dissatisfaction on the part of both marketers and public policymakers. Marketers have become increasingly concerned, in part, because of their growing emphasis on quality as a key determinant of future profitability and their realization that service intangibles play an extremely important role in determining that quality. For their part, public policymakers are increasingly concerned because of a growing realization that lack of oversight has been a major contributor to the ethical excesses in business...

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